REPAIR SHOP SEIZES CHANGE.

Byline: Tim Christie The Register-Guard

Last June, the owners, managers and technicians of Old Dominion Carstar Collision Center in Eugene began stripping their 33-year-old business down to the chassis.

Their aim was to make the business of fixing cars and trucks more efficient and predictable. More like an orderly production line, and less like the "big spaghetti mess" that it was, in the words of Dustin Caldwell, Old Dominion's vice president of operations.

But this was no Bondo job, it was more like dismantling the business with a sledgehammer. They literally tore down the walls in the shop. They lost longtime employees who weren't interested in the New Way. They lost money.

"The first month was a disaster," said Patty McConnell, Old Dominion's president and Caldwell's mother. `We all sat here and said, `Whoa!' Is this what we want to do?'

But they persevered, and in a few months, the rebuilding began paying dividends. The flow of work through the shop became more predictable. Technicians worked as a team, instead of on their own. The number of cars getting repaired each day increased. (A private company, Old Dominion does not disclose sales figures.)

This move to a new way of doing business was driven in part by a sense that the way they'd always fixed cars was not efficient, Caldwell said.

Caldwell, 33, had been working at Old Dominion since he was 22. When he took over operations about five years ago, he began thinking about ways to make the shop run better.

Under the old way, each technician had his own stall and would work on a car by himself, start to finish. The technicians also were expected to do administrative tasks and paperwork, he said.

"We were relying on them to manage the process," Caldwell said.

The other driver for the change was the insurance industry, which wants collision repair shops to fix cars faster, in part to reduce what they pay for rental cars and in part to keep their customers happy.

As company officials prepared to change the way they fix cars, they heard about a program offered by their paint vendor, PPG Automotive Refinish, a division of PPG, the large Pittsburgh-based paint maker.

The company offers management training for body shop owners and managers, teaching them how to improve the quality and speed of their work and reduce costs.

Becoming more productive and efficient has become a matter of survival for collision centers, said Rich Altieri, senior manager for business solutions for PPG Automotive Refinish.

Insurers are more likely to total cars, rather than pay to have them repaired. At the same time, cars have become safer with features such as antilock brakes and stability control systems, which means fewer cars are being repaired.

Auto insurers, taking a cue from health insurers, also are directing their customers to repair shops who are part of a network, which means more work is going to fewer repair centers, Altieri said.

Caldwell attended a six-day training session on PPG's Throughput Performance Solutions, or TPS, program. The program uses principles from three management theories: Lean, Six Sigma and Theory of Constraints. Lean means working more continuously on a vehicle and reducing the time it takes to fix a vehicle by eliminating sources of waste. Six Sigma involves eliminating variation in the process. The Theory of Constraints is based on the assumption that every process has one or two bottlenecks that slow production.

Boiled down, it means a commitment to kaizen - Japanese for continuous improvement.

In practical terms, these theories are used to improve the 20 percent of the repair process that cause 80 percent of the problems, Altieri said.

That means eliminating waste and defects such as inaccurate estimates and inaccurate parts orders. And it means taking the time at the start to determine everything that needs to be fixed "so the car is never sitting around without someone working on it," Altieri said.

Caldwell came back from his training a true believer. About 200 body shop managers and owners have gone through the training, but only a handful have embraced the new way as Old Dominion has, PPG officials said.

"Some people like Dustin are very visionary," Altieri said. "They see where the world is going and they attack it aggressively."

Caldwell, McConnell and the three other senior managers who made up the "guiding coalition" at Old Dominion began meeting with employees and talking about their plans for change.

"The biggest challenge was helping them understand why," Caldwell said. "We spent three months in meetings talking about it. We saw it as the next step for the industry."

Caldwell took his lead technician, Jimmy Tennison, back to a chain of shops in Syracuse that had adopted the new way. Initially a skeptic, Tennison bought into the new program, and "we had ourselves a partner," Caldwell said.

Other technicians weren't so willing to go along with the new program. Seven employees left the business, including one with 22 years experience and another with 12 years.

"That was painful," McConnell said. "There were tears in this office."

McConnell said she budgeted $100,000 to make the change, figuring most of it would be spent on changing the building and buying new equipment. In fact, most of the costs resulted from changes to staff, hiring, training and changes to the pay plan.

To help ease the transition, and in recognition that production would drop off initially, the managers guaranteed the technicians' pay even for three months, even when work dropped off.

Even anticipating a drop in business, the first month was rough. Production declined 25 percent in June from the same period a year earlier, McConnell said.

But, slowly, the new program began to take hold. The walls delineating each technician's stall were torn down and cars are now routed into one of three production lines. Those with light damage can be fixed in half a day. Those with medium damage take one to three days to fix. Heavily damaged cars will be in the shop for a week or longer.

Segregating the work this way ensures that the cars keep moving through the shop, Caldwell said.

"The old way was more of a push, trying to push a car through the shop," he said. "The new system is more like pulling a car through the shop. Each department is pulling a car from the department behind them."

The goal is to get one car into the paint shop every hour. "The whole system is dictated by the paint booth," he said. "You got to feed the monster."

Simple changes made big differences: The first thing technicians do is write on each car with a green water-based pen, detailing what needs to be repaired, and the expected date of finish. That way, anyone can look at a car, find out what it needs, and if it's ahead or behind schedule.

A rolling cart now follows each car through the repair job, holding parts needed for the fix. Appraisers use digital cameras to take pictures of damage and e-mail them to insurers, speeding up the approval process. As part of the new program, the managers began having lunch every Wednesday with the technicians on the shop floor. The lunches serve as a sort of brainstorming session, with the technicians doing most of the talking, offering suggestions for improving the flow of work.

"We're not used to giving up control," Caldwell said. "They're not used to being taken seriously."

One technician, for example, pointed out the extra work involved when they replaced a door. Under the old way, a new door would be fitted, or installed on the car, taken off, sent to the paint department, then brought back and fitted again.

"He said it doesn't make sense," Caldwell said. "We're repeating ourselves."

They changed the repair process so that doors were fitted only once, and saw an immediate bump in production, Caldwell said.

It's those kinds of changes, and commitment to kaizen, that are the key to making the new program work, McConnell said.

"We believe that success isn't a destination, it's journey," McConnell said. "We do believe we're on the road to success and every day we celebrate the small victories."

OLD DOMINION CARSTAR

Family-owned collision repair shop founded 33 years ago, with locations in Eugene and Springfield

President Patty McConnell is the majority owner; her son, Dustin Caldwell, is vice president of operations

29 employees; 25 in Eugene, 4 in Springfield